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ACCA Strategic Professional · Strategic Business Leader · Enabling success: disruptive technologies

Dalmoor Insurance plans to use customers' telematics and social media data to set individual premiums. The board is concerned that some customers have not agreed to this use and that the data might be breached. Which governance and risk response most directly addresses this concern?

The best response is a data governance framework covering consent, purpose limitation, security and clear accountability. This directly addresses unconsented use and breach risk. Collecting more data raises exposure, outsourcing does not remove board accountability, and restricting to descriptive reporting abandons the objective rather than managing the risk.

  1. AIncrease the volume of data collected to improve model accuracy
  2. BOutsource analytics to a supplier and transfer all accountability to it
  3. CEstablish data governance covering consent, purpose limitation, security and accountability for data useCorrect
  4. DRestrict analytics to descriptive reporting of historic premiums

Explanation

The concern is lawful and ethical use plus security of personal data, which is addressed by a data governance framework covering consent, purpose, access controls and accountability. Collecting more data increases exposure. Outsourcing does not transfer the board's accountability to regulators and customers. Limiting to descriptive reporting avoids the use case rather than governing it.

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